China's Tax Increases

Updated July 17, 2002 12:01 a.m. ET

China's economy is picking up speed a bit, according to the second quarter GDP figures released Monday in Beijing. That in turn has led some observers to hail the success of the government's fiscal stimulus spending and breathe a sigh of relief that last year's trend of slowing growth has been reversed. However, when one looks a little further ahead there's less reason for optimism. The main reason is that tax increases are looming over the most productive sectors of the economy.